we speak with the bank of england governor andrew bailey. t me just recap a little bit of what we heard so far from the bank of england, but also data overall. first of all, european stocks of rising. investors sifting through the latest company remains. that will show the extent of the fallout from the coronavirus. the pound has gained. this is treasuries are drifting. they also reported the surprise gain in exports. then norges bank with the interest rate now in zero. coming up, we have plenty more, the bank of england, we will look at giltm we will look at market movements, and we have a full update on covid-19. this is bloomberg. ♪ this is "bloomberg surveillance." still with us, john wraith from ubs. i want to get your thoughts on the u.s. how concerning is u.s. debt? will we see it hitting treasuries or is that not the right angle right now? john: i don't think it is necessarily -- certainly if you look at where yields are and how supply is being digested by all of these major markets, it suggests there are bigger focuses for the market

the bank of england says the u.k. yment date sees a 30% drop in consumption, which gives us a sense of some of the metrics they will be or have been building into the forecast. housing building activity has practically ceased. business investment about 50% below normal in the second quarter. two policymakers voted to increase the qa target by 100 billion pounds, so that is voting 7-2. the net result was no change in the target, but two dissenters did vote to increase that target by 100 billion pounds. i have seen some investors suggesting the qe program should be increased. they are also saying the bank of england has enough capital to absorb losses. we will see if we get any further insight into scenarios around growth, of interesting to see, they are talking about consumption in the u.k., one of the sort of high-frequency data points i guess they are looking at. a lot of other breaking news let's breakgh, so out this bank of england story a little bit. i-80 -- have i.e.d. -- coming out saying it plans to return to a

the next time the bank of england meets is in june with governor bailey hinting at stimulus. of the bank of england's nine policymakers wanted to immediately increase bond purchases and we will figure out why they decided to hold off and not do it today. this is bloomberg. ♪ francine: this is bloomberg "surveillance," tom and francine from new york and london. talking about the bank of england and the inflation forecast, let's get back to david page. when you look at the timeline, the bank of england seems more optimistic about a recovery in 2021 than other counterparts including the ecb. is it ugly 2021 and then a recovery or could this be a decade of misery? david: it could be either, and the bank of england would suggest -- would stress they are forecast theya are providing the flaws of the scenario. 2020ly we will get ugly followed by a sharp contraction in economic activity in the second quarter, and the question is how much of a rebound do we get from there starting in the second half of the year? the unknown is what path the virus will take and that is where the assumpt

we have a changing of the guard at the bank of england. governor bailey be different from governor carney? ways, weink in some will see some differences and particularly when mark carney started the bank, the bank was in the process of making a structural change. he has been in charge of monetary policy and was also taking charge of financial stability through the committees, and was being handed a good deal more responsibility when it came to bank supervision , so the bank was moving from one pillar to three. structural change to the bank has been completed and as a result, it is moving into a new era where we need steady progress rather than structural change. andrew bailey is an extremely experienced bank old hand, if you like. he spent a good deal of his movingat the bank before on other paths and coming back, and he will provide a good deal of continuity. francine: thank you for joining us, ian mccafferty. do not miss our interview, conversation with the bank of england governor andrew bailey. i just stepped out to do that interview a

brought up to one quite oh and now we actually had nicolas maduro back and power and actually the bank of england are executing. britain doesn't recognize him as the president of venezuela so if the bank of england had the option to take this money from venezuela somewhat knowing this why did they take the money in the 1st place and why did why do you think venezuela went with the bank of england is there something with the bank of england that's more you know attractive versus anywhere else. well everywhere i go in the world i find people with rob our over inflated sense of fair play and fair mindedness in britain it's as if they didn't know the history of the british empire is remarkable of venezuela to its gold in the bank of england i can't think of many worst places to put it and anyone else who's got gold there should get out very quickly indeed because when the wind shifts in washington it would appear of the so-called independent bank of england shifts with it no the only way you can resolve this spot on is the united nations as the repository of international law recognizes the i'm a dua

so i think the bank is probably erring on the optimistic side in terms of how quickly the economy will rebound. the bank of englandemphasise it can't forecast the economy right now — there's too much uncertainty. but it can be much surer of predicting the biggest recession on record than it can of predicting an extraordinarily rapid recovery. andy verity, bbc news. earlier i heard from our economics editor faisal islam. it is just simply extraordinary to see a chart like this never seen in the 300 year history of the entire institution because it does answer sharply. that is a very sharp fall, but as andy just said, sharply. that is a very sharp fall, but as andyjust said, a sharp rebound too. the thing is, we know the downturn has mostly happened already, that is in some of the data that they are looking at. it is a bit more hopeful this sharp rebound, and it depends notjust on economics, simon, it depends of course on epidemiology, it depends on politics and the response and the interesting thing is that despite this economic damage you are not getting a suggestion from the bank of england from economists to lif

inflation is less of a concern for the bank of england. the real economy, providing financing for businesses that need it. we have seen all sorts of government schemes backed by the bank of england in terms of providing liquidity which is money, credit, loans, financing for businesses just to get through the worst of this. but what they also to keep an eye on this just the overall state of the economy as far asjobs are concerned. overall state of the economy as far as jobs are concerned. in this forecast, it suggests unemployment could more than double by the end of the air, rising to about 9%, currently around 4%. there is a concern about what pressure that puts on public finances —— end of the year. as far as universal credit is concerned. we know the chancellor has said there will be no cliff edge as far as thatjob retention bellowing scheme is concerned but nonetheless, that has to end at some point because it is costing the government a lot of money. what business now need to work out is how many business now need to work out is how ma

i think the bank of england needs to be clear that it bank of england needs to be clear thatitis bank. with interest rates at re cord possible. with interest rates at record lows, that could be sustained for some time to come and we can focus on growth, not cuts. ed davy, acting leader of the liberal democrats, thank you for your time. the time isjust the time is just coming up to 6:45am. the message to stay at home may be getting changed by the government, but is that leading you to think about planning your summer holiday here in the uk? if the lockdown rules allow it, it could be welcome news to the tourism industry, which has already taken a big hit. adam mcclean has been to blackpool to see how businesses there are coping. here in blackpool, the beaches are almost empty. for the very first time, spring didn't come with a wave of visitors. for businesses like this bed and breakfast, the timing couldn't have been worse. you've refurbished, you've refreshed, you've redecorated, you've got your property ready for the coming season. and just when you're pushing the boundaries of your

bank of england -- open ended qe for the bank of england. >> we've got a rapid expansion of stimulus, so we got a lot going on. we have already got a lot that's happened, and we've got quite a long way to go in terms of what we've announced. in terms of payments, we will be going until probably early july. the view we took is that although we said in the march report that we will obviously continue to support the economy consistent with inflation targets, we are going to look at the news that is going to come out over the next month or so. we may get some important nose. we are actually expecting important news in terms of how the government's thing about lifting restrictions, and we will take that into account as with about what to do next. we've got some time and some room in that respect, but we are very clear that we are going to keep going in terms of what we are already doing. francine: did you discuss or consider open-ended qe? bailey: we've made a very strong commitment. this is more and faster than the bank of england has ever done before, and we will go on assessing what ne

we'll be analysing the bank of england's grim forecast. so this lunchtime: the cabinet meets to discuss easing the lockdown — but we'll have to wait until sunday to find out how the prime minister intends to do it. no easing of the lockdown in scotland — the first minister says to do so would be "very, very risky indeed". i will not be pressured into lifting restrictions prematurely, before i can be as certain as i can be that we will not be risking a resurgence of infection rates. at least eight people die, and thousands hospitalised, after a gas leak at a chemical plant in southern india. protecting nothing — the shipment of 400,000 ppe gowns from turkey, which was flown here by the raf, is impounded in a warehouse after failing uk standards. not the celebration they'd planned — but, under lockdown, britain prepares to mark tomorrow's 75th anniversary of ve day. and in the sport, there will be live football to watch again from as early as next friday, as the german bundesliga has given the go—ahead to resume, albeit behind closed doors. g

monitoring as they too relax some of these restrictions >> the data analytics about the appetite the bank of england has been considered about the bigger step away from the bank notes towards digital assets >> that is the trend that has been playing out over the years. the use of bank notes for transactions and the share of those paid for with bank notes have been declining. we have seen a drop over the past couple of months. by the overall level of transactions we'd have to see how enduring that is. i think it is not too early to say whether these changes are permanent or not but certainly something we are watching. >> thank you for giving us your time deputy governor, monetary policy, bank of england. >>> coming up, white house officials prepare to test on the virus response as president trump takes offense to questioning on the fall out. these days staying connected is more important than ever. so we're working 24/7 to maintain a reliable network, to meet your growing internet needs. we're helping customers who are experiencing financial difficulties stay connected. we're increasing internet spee

let me start with the zeitgeist of still shock over the bank of england's forecast yesterday. is an alphabet soup of recovery guesses and decidedly, the bank of england has 14% and% return. did that surprise you? was the governor being too optimistic. simon: good morning, tom. he was. unfortunately, the truism in labor markets, it is much easier hire.e than it is to there will be a lag trying to get back, with extensive for loading of workers. we expect unemployment -- furloughing of workers. we expect unemployment to get to 10%. the bank expects that to happen by 2022. i am afraid i am much more cautious. i expect it to be a much more prolonged hiring cycle. tom: the shock of lower interest rates yesterday on the negative yield indicated by the wirp function on the bloomberg, jay berry at jp morgan wrote of technical reasons that we saw the thrust to a negative interest rate forecast. was it that or was it the real understanding of the rate market over the depths of this jobless economy? simon: so i think there's probably more weight on the second one of those arguments. we a

thank you for giving us that overview about what the bank of england has said. former chancellor of the exchequer lord lamont. thank you for your time today. do you think the scenario set out by the bank of england today is a reasonable view of what might happen? yes, it obviously doesn't make comfortable reading, it is quite grim but it's not a surprise, and it is happening all over the world. iam and it is happening all over the world. i am sure there will be similar estimates from the united states, france, italy, european countries. this is not really a normal recession, it is a shutdown of the economy that has been caused by the correct decision of the government to shut the economy down temporarily in order to combat the virus. the question is, how quickly will we recover? how do you get out ofa will we recover? how do you get out of a recession that is not a normal one? you have to lift the restrictions when it is safe to do so restrictions when it is safe to do so and that can only be done gradually. we will hear soon how that will be done. i think one of

the governor of the bank of england said the economy is expected to contract by 14% — that's more thanwhat happened during the great crash of 2008. the unemployment rate could double to 9%, though the bank thinks the economy will bounce back next year. today the death toll from coronavirus rose again — 30,615 have lost their lives in the past eight weeks. more on that and the lockdown in a moment but first here's our economics editor, faisal islam. at east midlands airport there may be no passenger planes right now, but cargo carries on. the pandemic means new patterns in the goods being traded back and forth as the world's major economies face recession. coronavirus per se hasn't taken shipments out of our network, but the quarantine and lockdown and people working at home and factories being closed has. i can't predict the future but what i would say is that business heals. and it will have to be resilient, the bank of england today sketching out that the pandemic and the shutdown have plunged the uk economy into the sharpest downturn in history, a far worse start to a recession than

the bank of england has described the impact of coronavirus as "unprecedented" — and warned that the turies. modelling used by the bank found that if the lockdown was lifted injune there would be a 14—percent drop in gdp. here's 0ur economics editor, faisal islam. at east midlands airport there may be no passenger planes right now, but cargo carries on. the pandemic means new patterns in the goods being traded back and forth as the world's major economies face recession. coronavirus per se hasn't taken shipments out of our network, but the quarantine and lockdown and people working at home and factories being closed has. i can't predict the future but what i would say is that business heals. and it will have to be resilient, the bank of england today sketching out that the pandemic and the shutdown have plunged the uk economy into the sharpest downturn in history, a far worse start to a recession than the financial crisis over a decade ago, than any recession ever, but with the hope of a rapid rebound. morning, governor. so quite different in shape to that last recession says the gove

is the state of this theft of that is whale and gold by andrew bailey is the governor of the bank of england right now there is a not ongoing process in the judicial system of the u.k. we had to sue the bank of england because that money belongs to the national was service of n a sweater and at the moment the venezuelan state needs that money and that gold the equivalent of that gold to help to strengthen our capacities to confront the coronavirus threats but the bank of england says the no that. they are not sure who that money belongs to it's absolutely illegal what they are doing it's a theft the same that the united states did with our companies and refineries in the united states territory with citgo a very big company that we have in the united states but that they confiscated is the same it's the same that europe and the united states did with international reserves of levy you know more than 200000000000 euros in international reserves that money disappeared it has not been used for the libyan people it has not been used for the libyan development nobody knows where it is. so they're

the pound fell to a two-week low ahead of a bank of england decision. we speak with governor andrew bailey. welcome to "daybreak: europe." we are getting a little bit of a .ift through risk assets unexpected rise on exports. backtronger yuan off the of that. still some red on the screen in asia. the s&p dropped for the first time in three days in yesterday's session. european futures in the green. earlier, we were seeing the yen at its strongest or near its strongest since mid-march. you wonder about the knee-jerk reaction. the painful jobs report, a grim foreshadowing of what we could get out of the nonfarm payrolls tomorrow. ahead ofa two week low the boe decision. the expectation we could see more quantitative easing either this week or perhaps in june with the boe expected to hit its present the bond buying goal around the end of june. oil getting a little bit of a left, a little bit of that risk on. anchored near $24 a barrel. donald trump says he will keep his coronavirus task force running indefinitely. he said he would add or subtract members to

the former bank of england policy maker himself. p, speaking with the former bank of england governor. this is bloomberg. ♪ manus: "bloomberg daybreak: europe." let's get you up to speed with your first word news. votedanish parliament has to extend its the state of emergency by two weeks. the prime minister backed down from his earlier plans of a one-month extension. he did not have the backing. most has suffered europe's -- second-most extensive outbreak. almost 20,000 deaths. officials agreed the pandemic is causing an extraordinary amount of uncertainty. the banks could come under greater stress. it reinforces a gloomy outlook. chancellor angela merkel says a bailout of lufthansa is close. it says that the airlines management, berlin says the talks are ongoing. approve.ld need to they are saying, wait for those talks to end. dayal news 24 hours per powered by 2700 journalists and analysts in 122 countries. two of the biggest emerging market central banks have interest-rate decisions today. while the former was aggressively loosen

this is bloomberg. ♪ ♪ alix: the top news of the morning with the bank of england leaving rates pat, lly signaling more stimulus down the road. francine lacqua of bloomberg interviewed andrew bailey, the bank of england governor. francine joins me now. it was a really interesting, socially distant interview. what were some of your takeaways? francine: we tried to really understand from him whether anything changing with the lockdown of the u.k., it would completely change his forecast. went further than he did this morning, saying he is probably expecting more qe in june. i try to understand why juno not now. he said we have to wait for the lockdown and understand exactly when the end of the furloughs come, so it is all very critical, but what was also interesting is i asked why he was more optimistic, for example, compared to the ecb. the bank of england is in gdp this 4% drop year, but a quick recovery in 2021. we spent a bit of time trying to figure out exactly what would change his forecast and exactly his assumptions, given what he was saying. alix: any word on negative rates? fr

the bank of england mulls negative rates. he first meeting of the world health organization's governing body since the start of the coronavirus pandemic. china is said to be challenged on his handling of the outbreak. -- on its handling of the outbreak. good morning, everyone. this is "bloomberg surveillance." i'm francine lacqua, here in london. tom keene is in new york. a lot of the focus is on markets and businesses reopening. our -- i am looking forward to hearing from the w.h.o. they have not done this before. video conference. sparks could fly. tom: no question about it, the chinese will

coming up, the bank of england takes a first step toward easing its lockdown. s a good or bad time to invest in property? we will ask the chief executive of northacre. that is coming up next, and this is bloomberg. ♪ francine: "bloomberg surveillance this is -- this is "bloomberg surveillance ." let's get tea bloomberg business with ritika gupta. ritika: the company signed the deal with joe rogan. gaining occlusive rights to his podcast. signing rogan is a coup for the company, which has invested hundreds of millions of dollars in original podcasts over the past few years. his show greg italy ranks at or near the top of apple that his show regularly ranks at the top of apple's podcasts. sources tell us a private share transaction that pushes the company valuation up by a third. it reflects that the video -- despite the pandemic. francine: let's focus now on the u.k. property market. according to a report, prices in central london have dropped 1.3% over the past 12 months. with england taking the first step toward easing its lockdown, will buyers return this summ

we all know that the coronavirus has hit the economy, but today the bank of england has spelt outjustthe recession is. we are heading for what the governor of the bank, andrew bailey, called an "unprecedented" downturn. just look at what the bank thinks might happen this year: the economy is expected to contract by 14% — that's more than twice as bad as the great crash of 2008. the unemployment rate could double to 9% — though the bank thinks the economy will bounce back next year. and remember, all this after the untold suffering families have endured — we learnt today that the death toll today is 30,615. we'll be reporting on that and the lockdown later but first, here's our economics editor faisal islam. at east midlands airport, there may be no passenger planes right now, but cargo carries on. the pandemic means new patterns in the goods being traded back and forth as the world's major economies face recession. it's unfolding in front of our eyes, but at the end of the day, planes are still leaving certain origins and arriving at certain destinations. but it's somewhat more polari

dampen the down tuturn they have cut rates to support the norwegian economy. >>> let's move to the bank of england who has voted to keep rate steady and held off on injecting rates. in line with analyst forecast. the central bank has forecast a 14% drop in uk gdp this year and also predicted a 15% rebound in 2021 it stressed such a scenario would require significant and monetary stimulus. let's get to steve what do you make of what we heard from the bank of england pretty significant commentary. that's my take away. >> these numbers are shots in the dark they are examples, as we've seen, i'm sure viewers will be looking at how difficult it is to assess data the bank of england says we've lost this percent. accumulating the data physically is so blooming difficult the numbers are enormous first quarter down 2.9 second quarter down 14%. 15% recovery next year frankly, they are educated shots in the dark. i totally take your point there is a degree of optimism and perhaps a v-shaped recovery, which appears to be the andrew recovery a lot there about the business investment and the declines there and

so quite different in shape to that last recession, says the governor of the bank of england. think it is unprecedented in the history of this institution. i would say it's different in two respects. it's a much sharper downturn, so the initial fall is much more pronounced because the economy literally went into shutdown very quickly. the recovery is actually much faster because we believe that, you know, with the right measures in place from the public health side and the fact that it's supported by the very sensible things that the government has done, that economic activity can resume much more quickly. given the uncertainty, this is not a formal forecast. there may be more than a glint of optimism here. never in the history of this institution have we seen it anticipate a recession quite so sharp. the hope is that the rebound will be almost as sharp into next year, but that is as much a matter for doctors and politicians as economists. but despite that economic damage, there's no pressure here for an instantaneous lifting of the lockdown. a second wave of the pandemic would

you can track the bank of england testimony of andrew bailey right here on bloomberg tv 2:30 p.m.- london time. we will talk about the subject and the focus and the prospect of the u.k. economy. this is bloomberg. ♪ ♪ nejra: this is "bloomberg daybreak: europe." manus cranny is in dubai. let's get to the risk radar and investors might be bearish, according to bank of america but we see a little bit of green on the screen from asia today. futures point higher today. european futures lower, 10 year yield is study, so is dollar-and. it is really the kiwi -- dollar-yen. it is really the kiwi you want to look at. oil, the rally stalling but we are slightly integrate. speaking of -- in the green. speaking of negative rates, let's turn to the u.k. country issays the heading into an unprecedented recession as he laid bare the extent of the economic cost of the coronavirus. later today, we will hear from the bank of england governor andrew bailey. he is giving testimony and was minister. you can catch that hear from 2:30 -- in westminster. you can catch that here from 2:30. still with us i

the bank of england sets to boost its program. is --or bailey says it italy's government signs off on a 55 billion euro stimulus package as angela merkel bows to defend. good morning, everyone. this is "bloomberg surveillance ." tom, a bit of pressure on the markets. they are looking to find out more about the situation in the u.s.. the numbers have been horrific, and they are bracing for another difficult set of numbers. andrew bailey from the bank of in june.ay more action thrustsre are two major that i would suggest to governor bailey and also to chairman powell. yesterday, the continued inflationary trend and the outright deflationary trend in switzerland. the numbers in europe in inflation on price change are simply grim, and you are dead on about unemployment. overnight, goldman sachs readjusted their unemployment rates, and they get steve englander of standard chartered bank, a stunning statistic, francine -- 25% unemployment rates modeled out now by goldman sachs. and of course we get claims at 8:30 this morning. francine:

today the bank of england warned of an "unprecedented" recession that hasn't been seen before. nk predicts the uk economy will fall by 30% in the first half of this year due to the impact of coronavirus. but the bank thinks the economy will bounce back. our economics editor faisal islam has been speaking to the governor. i think it is unprecedented in the history of this institution. i would say it is different in two respects. it is a much sharper downturn. so the initialfall is much more — the economy literally went into shut down very quickly. the recovery is actually much faster, because we believe that with the right measures in place on the public health side, and the fact that it is supported by the very sensible things that the government has done, that economic activity can resume much more quickly. the bank of england sees unemployment more than doubling up a million—and—a—half to rates not seen since the mid—1990s, and taking and taking two years to then fall back. people at home — they see that chart, and it looks quite scary. the chart reflects the reality that we'v

the governor of the bank of england not ruling out the possibility of the u.k.gative, three year negative. the 600 was up 1%. italy yields catching a bid. they are going down. crude trading at 35.60. vonnie: a nice bounce and equities in the u.s.. we are off our highest but we are still 2% higher. the s&p 500 is looking towards the 3000 mark again, up 55 points. that is all sectors higher. would you believe the stock leading the s&p 500 is mgm resorts international? at some levelow of reopening. we will see what happens in the coming weeks, but that is the way things stand from a state level. we also have harley davidson up 7.8% and a handful of stocks lower. they include retailers like l brands, gap, and so on because we have target saying we do not know what is happening with the u.s. consumer. it is difficult to tell. polls down 2.7%. nordstrom down 2.5%. campbell soup down 2.3%. stay tuned. coming up in the u.s., we have "balance of power" with david westin. one of the conversations will be with terrence anthony, national league of cities ceo on the latest a

: we also heard from andrew bailey about keeping options open for more monetary action by the bank of englandrkets are definitely pricing and more action in june. what could that action look like? noted -- hey certainly have not waived the markets off that idea. with the expectation of investors and economists, we will see more quantitative easing from the bank of england. they paused most recently. open to more action in the coming months and the markets would be disappointed if that is not forthcoming. francine: how difficult is it to be a central banker right now? i know we keep talking about it, but is it because everyone is doing a lot and you are trying to work in concert with treasuries around the world? is it easier now than in 2008, or more difficult? layn: what 2008 did was some -- to make sure that central banks would never have thought possible. this time around they know they are possible. during the banking crisis it was a bit slower, off the mark. now there is a toolbox come if you would like. banks,banks -- central there is negativity in japan and with the euro. there is a gre

the former bank of england governor. we will talk with him about negative rates and deflationary pressures. that is coming up in about 45 minutes from now. this is bloomberg. ♪ >> we are not ruling it out, and now is the right time. also --ay, we will tom: the governor of the bank of england. with us, jeremy stretch, from cibc markets. looking at monetary policy this thursday and how it links in with all we do. jeremy, we were talking in the last block about the subtle shift that someone can signal when taking over as the leader of the central bank. governor bailey has been handed negative rates. what does he do with that? do the markets tell him what to do? how does he tactically respond to negative rates? well, it is interesting. as you say, somebody who arrives in a new role has an opportunity to look at the remit and the of parameters, and innocencio make sense for governor bailey to do that. came inse, whilst he suggesting that he agree with previous assumption, he is now opening the door to reassess that option. th

but again we don't think the bank of england cuts its target rate below zero. there's enormous amount of uncertainty around this. i think it's some of the same drivers that we do think the negatives on the banking system in the u.k. and the ability of banks to intermediate credit could be negatively affected for relatively modest gain. it can be a negative impact for consumer sentiment because obviously the focus becomes on well, why are -- why is the central bank taking this action? does it indicate the economy is worse than i expected? i think there are a number of factors that i think reasonably would give the bank of england pause. i think timing could matter here. by the time -- if we're looking forward a couple of months, i do think some data will start to look less bad and that could remove some impetus to take on such drastic measures. nejra: andrew sheets, chief analyst at morgan stanley, stays with us. lenders led by credit suisse are targeting the family assets aze they try to recoup losses in loans. this deal soured after the mpany became embroiled

bringing devastation tojobs and incomes — the bank of england warns the coronavirus pandemic will pushland have put in place a very big package of measures, and we will go on utterly focused on that and doing the things that we need to do to support the people of this country. the cabinet meets to discuss easing the lockdown — but we'll have to wait until sunday to find out how the prime minister intends to do it. no easing of the lockdown in scotland for now — the first minister says to do so would be "very, very risky indeed". i will not be pressured into lifting restrictions prematurely before i am as certain as i can be that we will not be risking a resurgence of infection rates. protecting. . . nothing. the shipment of a00,000 ppe gowns from turkey, which was flown here by the raf, is impounded in a warehouse after failing uk standards. not the celebration they'd planned — but, under lockdown, britain prepares to mark tomorrow's 75th anniversary of ve day.

the bank of england governor is on the more qe way. you just said, jerome powell weighing on the u.s. equity market yesterday. interesting that he just said that liquidity problems could become solvency issues. he did not rule out negative rates completely. a chorus on wall street talking about the overvaluation in equity markets. manus: the rates market and the fx market heard two different messages. politically, the dollar is the supreme currency. certainly, the rates market, they just did not get the message. they want to propagate. let's have a look at the rate board. april futures, fed fund futures, just touching up against the negative rates narrative. the evidence is mixed. jpm says the benefits will outweigh the costs. the dollar rises. fx traders heard something else. global risk means the dollar will remain the supreme leader. that more qe is on the way. stocks under pressure. david tepper talks about, as ominous as 1999. the 594,000is people have lost their jobs in australia. so you are looking at a crashing down unemploymen

it is the job of the government and the bank of england to make forecasts to try to model the way aheadhat but it is predicated on unknowns that are part of the uncharted waters we are already in with this pandemic, about whether the lockdown can actually be eased injune, buti the lockdown can actually be eased injune, but i don't know if it actually knows how to predict human behaviour is, because the lockdown can be eased, but whether we ourselves as individuals want to make the choice of going out again to bars and restaurants, doing the activities that we as social creatures tend to do, or to shy away from that because of the continued fear of contraction is anyone's guess, so fear of contraction is anyone's guess, so this model and forecast that the bank of england has seen that the bank of england has seen that by the second half of next year the british economy will have re cove red, the british economy will have recovered, it will have got back on the same footing it was before the pandemic broke out, it is in a sense anyone's guess. took us through the personality of the prime

what i do agree with his i don't think it is going to be the for the bank of england. n't think they are going to go to negative rates. i think it is less a concern necessarily about sterling and more in terms of the impact that would have in terms of the banking sector. what we have seen elsewhere in the world is if you combine substantial quantitative easing bond buying with the negative rates, you end up with a flattening of the curve, an extension of negative yields across the curve, and it is very negative for the banking sector. i think that would, in turn, potentially lead to some tightening in credit conditions, which is the complete opposite to what the bank of england is trying to achieve. just very briefly, it is also a communication issue. which enter bailey referred to, as well. what is the signal that is sending to the broader, general public? you could have the reverse effect on negative interest rates increasing precautionary saving by the public rather than reducing it. matt: all right, david, thanks very much. pleasure getting some time with you today.

the economy will fall for the first half of the year due to the impact of the virus, but the bank of englandhinks the economy will bounce back. >> this is unprecedented in the history of this institution. but it is different in two respects. the initial fall happened because we went into lockdown weekly. the recovery and theact that it is supported by the sensible things the government has done, means economic activity will resume much moreuickly. >> the bank of engla sees unemployment doubling to rates not since the 1990's, which took two years to then fall back. >> if you look at the chart, it looks right scary. >> the chart reflects the reality we have been in since march. i can tell you that the government and the bank of england have put in place a package of measures and we will go on utterly focused on that. host: our political correspondent was monitoring that. he joins us live now. what is behind the government laxing the lockdown? are we talking about health or economic reasons >> the first thing to say is this is not going to be some dramatic change in the long term. the governmen

bank of england governor does not rule out negative rates. the fed chair jay powell speaks again this evening. good morning and welcome to "bloomberg surveillance." i am francine lacqua in london. we discuss everything with monetary and fiscal policy. look at. in london, we your markets. this is what they are telling us . we are getting data out of the euro area that manufacturing is a bit better than expected. 38 that was of forecast. services pmi for the month of may for the euro area, a touch better than expected. overall, i am looking at what the risk in china means for treasuries. they are advancing with the dollar. let's get straight to the bloomberg first word news in new york city. >> tensions are boiling over between britain's chief negotiator, david frost, and his part, michel barnier. key summit looks certain to expose key divisions between the two sides. the spanish parliament voted to extend its state of emergency by two weeks. plan of a one-month extension did not have the backing to pass the measure. second moste's extensive ou

we are getting a bit of important news out of the bank of england. it looks like the new governor is making changes in terms of the way events are going to be scheduled. the headline at the moment suggests the bank of england is may 7to publish the decision at 7:00 a.m. normally it comes out at noon. the press briefing will then happen a little later. we are hearing suggestions around all of this timing. we are not entirely sure what the press briefing is going to look like and when exactly it is going to happen, if it is going to happen. andrew bailey, new governor of the bank of england, looks like he is making changes in terms of the scheduling of the delivery of the news, which will now come out premarket. this is bloomberg. ♪ vonnie: live from new york, i'm vonnie quinn, along with guy johnson in london. this is "bloomberg markets." it is risk off across the united states. some markets closed across the world. let's get more on the markets with kailey leinz. kailey: we start may deeply in the red. many markets in europe are closed today, but we d

what could the bank of england do? what is left in the ecb toolbox? you have to wonder what is left. erik: i think that one thing we have learned ring this pandemic banks reallyal don't run out of tools. was a common thing a lot of people kept saying, but the only restrictions are what i central bank can do that is really political. it is just not politically acceptable or nice at this stage. the fed to spend their ratings criteria, so you can buy things. they are calling it junk now. so you can go in a whole lot of places. you can go into the money market if you want. there are lots of things you can do. you are in quite unusual territory, and the central banks have a lot of people on the governing council who are not economists, and are probably somewhat uncomfortable with bere we are, but it can done. ok. stick around. we still got plenty more questions to put to you. erik nielsen joining us from unicredit. let's figure out what is happening in the market. here is taylor riggs with the details. taylor: it seems like an everything rally going on righ

that's to illustrate a warning from the bank of england that the uk economy is heading towards its sharpestecession in more than 300 years.

the bank of england has warned that the uk is heading for its worst recession in history. the impact of coronavirus would see the economy shrink 14% this year, based on the lockdown being relaxed injune. france will begin reopening from monday, bringing to an end two months of confinement. but strict restrictions will continue to apply in paris and its surrounding areas. the usjustice department is dropping the criminal case against michael flynn, the former national security adviser to president donald trump. mr flynn was charged with lying to the fbi about his contact with russia. hello and welcome to our look ahead to what the papers will be bringing us tomorrow. with me is the deputy political editor of the sun, matt dathan, and the director ofjohn smith centre at glasgow university and former scottish labour leader, kezia dugdale. welcome to you both again. let's go through some of the front pages briefly before relook at in detail. the times reports that borisjohnson will keep the uk in lockdown untiljune, after warnings that outbreaks in care homes and hospitals make

the bank of england warns the coronavirus pandemic will push the uk towards its deepest recession on record. the government and the bank of england have put in place a very big package of measures. and we will go on utterly focused on that and doing the things that we need to do to support the people of this country. the cabinet meets to discuss easing the lockdown but we'll have to wait until sunday to find out how the prime minister intends to do it. no easing of the lockdown in scotland for now. the first minister says to do so would be "very, very risky indeed". i will not be pressured into lifting restrictions prematurely, before i can be as certain as i can be that we will not be risking a resurgence of infection rates. analysis of deaths from coronavirus in the uk reveals that the risk of dying from covid—i9 among some ethnic groups is significantly higher. and the coronavirus contact tracing app, being trialled on the isle of wight, goes live to the general public today. good afternoon and welcome to viewers on bbc one and the bbc news channel, ahead of today's daily coronavir

so what more can the bank of england do? her £200 billion worth of quantitative easing printing money to pump into the financial system and keep borrowing cheaper. joining me now is george buckley, chief uk & euro area economist at nomura. he's at home in gerrards cross, just outside london. what more can the bank of england do at this stage? to be fair, they have done quite a lot already by cutting interest rates to what is effectively their lower bound. the bankers said it already cannot do much more then lowering interest rates than they already have done, as you say, £200 billion of quantitative easing and that has to do more of the same, if anything. if they continue to purchase bonds is quantitative easing scheme at the current rate, they will be done by earlyjuly. i rate, they will be done by early july. i suspect rate, they will be done by earlyjuly. i suspect they probably do not want to be done by earlyjuly, the depth of this crisis and the impact of the virus is having. i think they need to continue purchasing for

interesting the bank of england saying that even it's absolutely dire in the immediate to midterm he a v—shaped recovery will come back. he was are you as optimistic? i think he's in a better place that need to know. i think there is a positive and that story that's definitely it. the stark headline, the worst recession in 300 years. in the detail of the story it tells us that the outcome of the economy is down 30% as is household spending. this is a really serious fall. as you see the big question is how long does it last? q. question is how long does it last? 0. week question is how long does it last? q. weekfor question is how long does it last? 0. week for the question is how long does it last? q. weekforthe banks question is how long does it last? 0. week for the banks to keep land in? that going forward. a warning to the banks to keep on warning and anecdotally that doesn't always appear to have been the case, does a? there've appear to have been the case, does a 7 there've been appear to have been the case, does a? there've been a lot of complaints about how much the banks are

it is right the bank of england has said they are considering them. ave been quite clear they are not ruling them in right now. the governor is not a fan of negative rates. he said it creates problems for commercial banks and it is hard to explain to the public. that has been the bank of england stands for quite a few years now. they do not want to rule out. the academic evidence on their efficacy is mixed. central bank's have used them around the official account from the swedish central bank has been released and is pretty damming. the ecb thinks they are working well. that academic study from the federal reserve bank in san francisco suggests cutting to negative territory is still effective, but perhaps by as much as 40% less effective than the cut when you are in positive territory. i think because the evidence is mixed, because of past comments from the bank of england, i think we are more wait and see ramp-up in qe as a first measure before negative rates furthered down the line. line.ther down the manus: everything you said is sound. the market

and venezuela has fined a legal claim to try and force the bank of england to release $1000000000.00 worth of its own gold the government says is to help funded school run a virus response the bank of england has gone to 31 tons of venezuelan gold since 2018 because of u.k. and u.s. sanctions a number of nations use the bank of england to store their bullion reserves in other world news at least 26 people have been killed and many more have been made homeless after a powerful storm slammed into eastern india and bangladesh sank lower and battered west bengal in odisha states with winds of up to 170 kilometers an hour it's destroyed homes flooded streets uprooted trees and cut power to millions of households hundreds of thousands of people have shifted from low lying coastal areas well we'll have an update on the situation in bangladesh in just a moment with tanveer childfree who's in dhaka but 1st let's speak to prima rajaram who joins us live from skype from kolkata in india's west bengal west bank that is of course where the cycle made landfall almost 24 hours ago how much damage ha

and venezuela has fined a legal claim to try and force the bank of england to release $1000000000.00 worth of its own gold the government says it's to help fund its coronavirus responds the bank of england has held on to 31 tons of venezuelan goal since 1900 because of u.k. and u.s. sanctions a number of nations use a bank of england to store their 1000000000 resource reserves in other world news a powerful cycle has killed at least $26.00 people and left many more homeless in eastern india and bangladesh psycho battered west bengal in odisha states with winds of up to 170 kilometers an hour it's destroyed homes flooded streets uprooted trees and cut power to millions of households hundreds or thousands of people have shifted from low lying coastal areas tanveer chandra is in bangladesh's capital dhaka way he says the extent of the damage is still being assessed now we know for sure that hundreds and thousands of houses around delta plane have been destroyed or washed away oxfam reported the same about thousands of mud houses were washed away by the tidal wave and we also know about $